This market brief is an overview of the week ahead and some of the events we see as being important to the markets.
Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.
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We may take multiple trades throughout the week and discuss in our LIVE CHAT ROOM.
Trade View has entered the weekend Net Long.
AUSTRALASIA
ASX – 5312 ( – 99 or – 1.83% )
The ASX continued falling last week breaking through an all important level of 5366 after a few attempts. Once it did the drop was fast as it dipped below 5300 for a period on Friday.
NOTE: Bullish Divergence forming
For the up move to restart we would like to see an early solid long up bar break and close past the all important 5366 area. Once this is achieved we could see the ASX rebound strongly breaking through 5382 and 5415 before testing the area between 5447 – 62.
For the down move to continue we would like to see a strong move past 5270 before testing the area between 5199 – 76. If the momentum continues strong we might see an extension down towards 5072 – 56.
EUROPE
FTSE – 6669 ( – 170 or – 2.49% )
As soon as the FTSE moved lower it kept going. But then found strong support for the rest of the week near our FICM level of 6632 by reaching a low of 6614.
For the move higher to restart we would like to see 6632 hold as a strong level of support before a move past 6703 is attempted. Once this level is broken we could see a push towards 6755 and possibly 6816. If the momentum is strong then we could see 6852 tested.
If the downside move takes full effect then a strong break and close past 6836 could lead the Index past the area between 6652 – 32 reaching 6595. Once this occurs we could see the FTSE test the area between 6550 – 23 which was support back in August 2014.
DAX – 9535 ( – 255 or – 2.60% )
The DAX felt the brunt of last weeks down move as it closed lower by more than 2.50%. Just remember we have said this before, The DAX moves quick and tends to overextend its moves. Therefore caution should be taken ahead.
If the DAX restarts it’s move higher then we would like to see a strong break back up above 9580 before reaching 9672. If we then see 9672 broken with a long up bar then a push higher towards 9790 is possible.
If the DAX continues it’s strong move lower then we would like to see an early break and close back down past 9475 before reaching 9401. This too will need to be broken with a long down bar before reaching 9303. If the downward momentum is strong and the DAX overextends itself then the area between 9200 – 9163 is not out of reach.
US
S&P – 1983 ( – 26 or – 1.29% )
Ooops, the S&P did not like staying above 2000 for long moving much lower early in the week and the momentum pushed it down for the rest of the week.
For the up move to follow through after Friday’s strong close we would like to see 1981 hold as a strong level of support before a push past 1993 is made with a long up bar. This will then need to be followed through with a further strong long up bar break past the all important(psychologically important) level of 2000.
Our downside comments remain the same as we see 1981 as the key level to break and stay broken. For the down move to continue we would like to see a strong break and close below 1981 before reaching 1968 again. If the downward momentum is strong then 1943 and 1927 could be reached.
FOREX
AUD.USD – 8765 ( – 160 or – 1.79% )
The AUD continued lower last week. As mentioned before “With USD strength forming all over it will be hard for the AUD to gain upward momentum”
For the up move to restart we would like to see a solid long bar break and close back above 8823 before potentially reaching 8971.
The AUD has now broken down and the next key level is 8660 (lows from Jan 2014). This would be the first target before we need to reassess the downside move therefore once 8660 is broken we will discuss in our LIVE CHAT ROOM.
EUR.USD – 12682 ( – 145 or – 1.13% )
Another move lower for the EUR with USD strength continuing.This time closing below 12700.
NOTE: Bullish Divergence forming
For an upmove to restart we would like to see an early break and close past 12763 before we could see 12836 again. Once this level is broken then we need to see further upward momentum towards 12915 and possibly an extension back to 13010.
For the down move to continue we would like to see 12763 hold as a strong level of resistance. This could then lead to a further breakdown in the EUR and push past 12625 reaching 12543 and if the USD gains strong momentum we could see an ambitious reach towards 12375.
GBP.USD – 16240 ( – 45 or – 0.28% )
Now that the referendum is over the GBP looks stuck. As the move was on 45 points our comments remain the same. NOTE: It is trading within 4 Standard Deviation from the highs.
For the GBP to move higher we would like to see a solid start to the week breaking and closing past 16280 which would then become a solid level of support before the up move breaks past 16333 reaching 16395. Once this level is broken then 16458 could be seen and 16524 could be tested again.
If the GBP is to take another leg lower, we would like to see an early break past 16229 occur. Once this level is breached then we would like to see another strong push past 16148 before it dips below and prints 15986. We will also be watching 15723 closely if the GBP decides to GAP again.
USD.JPY – 10927 ( + 23 or + 0.23% )
The USD took a rest last week against the JPY after a stellar run up for the month of September. Therefore our comments remain the same with slight amendments
For the USD to move higher we would like to see 10914 become a strong level of support before a strong push past 10998 and popping its head above 110 is made. Once this level is reached we will discuss the next possible levels in our LIVE CHAT ROOM.
If the down move restarts we would like to see an early break and close back past 10836 before reaching 10683. If this level is also broken then we could see 10541 provide some support.
COMMODITIES
GOLD – 1218 ( + 3 or + 0.25% )
After a strong move lower over the past few months GOLD is forming a potential slowdown, but as long as “The less there is to worry about the more GOLD becomes unloved” then this could be short lived. Also our comments from last week remain the same
For the upward move to restart we would like to see 1215 hold as a strong level of support before an early break back past 1230 occurs, this would then allow for a solid break back above 1241 also breaking through 1252. Once this occurs we could see GOLD near 1274.
If a down move continues then we would like to see a strong break below 1215. If the momentum is strong then we could see GOLD below 1200 and possibly testing the lows of June 2013 and Dec 2013 of 1180 and 1182 respectively.
US LIGHT CRUDE OIL – 9336 ( + 168 or + 1.83% )
OIL rallied higher after an initial drop early in the week even though supply is high and demand is low.
For the upmove to continue we would like to see another solid break and close with a long up bar past 9367. Once this occurs we could see an explosive move through 9448 and 9557 reaching a strong level of resistance near the 9697 – 9721 area.
If OIL restarts a move down then we would like to see solid breaks past both 9233 and 9144 before a possible break past 9058 occurs.
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